Loans

Long-term loans are available through several sources. Cornell University participates in the Federal Direct Student Loan Program, through which eligible students receive Federal Direct Stafford/Ford Loans. The application for these federal loans is the FAFSA. Some direct loans are subsidized by the federal government, which means that they are available at less-than commercial rates of interest and the interest is paid by the government during periods of at least half-time attendance and any grace period allowed. Some are not subsidized. Repayment of principal on unsubsidized loans is deferred during periods of at least half-time attendance and any grace period allowed, but interest, which accrues from the date of disbursement of the loan proceeds, must either be paid as it is billed or capitalized (added to the principal). Loans offered through the federal student assistance programs are guaranteed for repayment by the federal government should the borrower die or become totally disabled before repayment is completed. If at all possible, we strongly recommend the use of no more than two loan sources, as each source will require monthly payments when the loans become due.

Subsidized Loans

Federal Direct Stafford/Ford Loans (FDSL) Eligibility for the FDSL is predicated on a financial need being demonstrated through the FAFSA application, which must be filed for each year for which a student wishes to receive financial aid. Students in a professional curriculum who demonstrate need may borrow up to $8,500 per year, to an aggregate undergraduate and graduate limit of $65,000. Borrowers whose first loans were disbursed prior to October 1, 1992, pay interest at a fixed rate of 7 to 10 percent, depending on the date of disbursement. The interest rate on loans disbursed on or after October 1, 1992, is set on July 1 of each year, and is determined by the average rate offered on Treasury bills over the past three months, plus 3.1%. The maximum rate of interest which may be charged is 8.25%. Interest is subsidized (paid by the federal government) until loan repayment begins, six months after the borrower leaves school. An origination fee of 3% of the principal amount of the loan is assessed as each loan is disbursed. Loan proceeds are paid directly to students' bursar accounts, in two equal installments, upon receipt of a properly completed promissory note. The FDSL is expected to be the first self-help loan. Perkins Loans, Health Professions Student Loans, and College grants are offered to eligible students as supplemental to this loan. Federal Perkins Loan (FPL) Federal Perkins Loans are offered through the College of Veterinary Medicine by Cornell University, the lender. Eligibility is based on current need, prior indebtedness, and prior borrowing of Perkins/NDSL money. Borrowing is limited to $30,000 (undergraduate plus graduate). Payment of principal plus 5% interest begins nine months after full-time enrollment in an eligible program ends. The application is the FAFSA. Health Professions Student Loan (HPSL) Like the FPL, the HPSL is offered by the College on behalf of Cornell University. The loans are federally guaranteed, and eligibility criteria are similar to those described for the FPL, except that, regardless of the student's age, marital, or dependency status, complete parental data is required on the FAFSA and the imputed parental contribution must be considered available to the student when determining need for this loan. Both the FAFSA and the CSS forms must be submitted by students wishing to be considered for aid from this source. The maximum annual loan available is defined as cost of attendance; however, available funds are usually not sufficient to allow maximum awards. Interest is at 5% during the repayment period, which begins one year after the borrower ceases to be enrolled at least half-time.

Unsubsidized Loans

Federal Direct Unsubsidized Stafford/Ford Loans (FDUSL) The Federal Direct Unsubsidized Stafford/Ford Loan for Middle Income Borrowers is intended for those students who do not qualify for (some or all of) the FDSL. A total of $18,500 per year is available through the Federal Direct Stafford/Ford Loan Program. The amount of FDUSL available is the difference between $18,500 and the student's eligibility for the subsidized direct loan. The variable interest rate and origination fee, are the same as for the subsidized Stafford/Ford Loan. The difference is that, although principal is deferred, interest accrues from the date of disbursement.

$189,125 less
subsidized loans *

 T-Bill + 3.1%
(8.25% Max. **)

 T-Bill + 3.1%
(8.25% Max. **)

 FAFSA
no parental data

FAFSA
no parental data

FAFSA and PROFILE 
with parental data

FAFSA
no parental data

Deferments
(see below)

Deferments

1. At least half-time attendance 2. Limited period of unemployment 3. Limited period of economic hardship 4. Graduate or post graduate fellowship-supported study outside of U.S. 5. Limited period of military service 6. National service volunteer 7. Approved rehabilitation programs for disabled individuals 8. Approved periods of community service activity 9. Advanced period of temporary disability 10. Limited period of temporary disability 11. Full-time graduate study within U.S. * Total undergraduate and graduate/professional unsubsidized Stafford/Ford Loan limit is $189,125 minus total subsidized Stafford/Ford Loans. ** Maximum interest rate allowed varies, depending on when the borrower first received a Federal Stafford/Ford Loan. Refer to your copies of the Federal Stafford/Ford Loan documents to determine the maximum rate of interest, which may be charged.